The post Nasdaq Proposes In-Kind Bitcoin Redemptions for BlackRock’s iShares ETF Amid Regulatory Changes appeared on BitcoinEthereumNews.com.

The landscape of cryptocurrency investment is poised for transformation as Nasdaq proposes a groundbreaking rule change for Bitcoin ETFs. This change would allow Bitcoin redemptions in-kind for BlackRock’s iShares Bitcoin Trust ETF, a move that could enhance market efficiency. According to Bloomberg ETF analyst James Seyffart, this proposal simplifies the redemption process, potentially reducing Bitcoin selling pressure during redemption requests. Nasdaq’s proposed rule change could revolutionize in-kind Bitcoin redemptions for BlackRock’s iShares ETF, improving trading efficiency and stability. Nasdaq’s Proposal: A Game-Changer for Bitcoin ETFs The proposed rule change by Nasdaq aims to facilitate in-kind Bitcoin redemptions for BlackRock’s iShares Bitcoin Trust ETF. This marks a shift away from the traditional cash redemption process, presenting an opportunity for authorized participants, primarily large institutional investors, to redeem ETF shares for the actual Bitcoin held in the fund. This change could have significant implications for the operational dynamics of Bitcoin ETFs. Currently, market makers facilitate cash transactions when investors redeem shares, which can lead to increased market volatility as Bitcoin is sold to satisfy these cash redemptions. By allowing in-kind redemptions, Nasdaq is paving the way for less disruptive trading practices and enhanced liquidity in the underlying Bitcoin market. Understanding the Implications of In-Kind Redemptions As the SEC focuses on establishing clearer regulations around cryptocurrency, the timing of Nasdaq’s proposal aligns with broader regulatory shifts and an enhanced understanding of cryptocurrency assets. The recent rescind of the SAB 121 rule, which restricted banks from providing custody for crypto assets, was a significant move that complements this proposal. James Seyffart, a noted analyst at Bloomberg, emphasizes that this proposal will streamline the redemption process, enabling fewer parties to be involved, thus expediting transactions and reducing costs. “The side effects from abolishing SAB 121 are likely only just beginning,” Seyffart stated in a recent…

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Filed under: News - @ January 25, 2025 12:26 am